Here's the trigger for FTSE 100 to hit record high

FTSE FOR FRIDAY (FTSE:UKX)

This week on the FTSE 100 has been pretty interesting - and a bit rubbish, too. For some reason, the market has found our 7,385 a fascinating concept, managing closure at this level twice.

At least it proved we're watching the correct trend, but we just wish the market would close above this level. The risk of this malaise, from a software perspective, is future moves proving half-hearted should the market actually now better 7,400 points.

As always, please remember we're talking about the FTSE during trading hours and not outside hours futures.

Perhaps the 7,385 nonsense may prove valuable as, generally, the third time a trend is challenged is the charm. It results in the situation where anything near-term above this week's highs of 7,400 should present 7,439 as the initial ambition, maybe even 7,480 if such a level is bettered.

Our worry comes from the hesitation the market is showing in painting new highs, as the FTSE is perfectly capable of producing a fake upward movement, probably at the open of trading to trigger a bunch of orders.

After all, anyone blessed with eyes will have figured out the 7,400 level has proven an intraday issue recently, and we'd suspect quite a few orders await being triggered.

Our preference would be to use the 7,409 number of a month ago as a safe trigger - yes it reduces the profit, but it also reduces the likelihood of the FTSE saying "thanks for the order" with an opening surge before reversing to say "thanks for the stop loss, too".

Visually, the tightest sane stop loss should be at 7,309, which is just a touch uncomfortable.

No-one ever said the market is fair. It is in business to make money, after all - this being something people tend to forget.

On the flip side of the coin, if the FTSE manages to stumble below 7,369, it appears weakness to 7,348 makes some sense. Perhaps not the most attractive trade but, if triggered, the stop can be 7,394 points.

Secondary, if 7,348 breaks, is at a more attractive 7,324 points - yet another number which should be familiar to regular readers. Despite our utter fascination with numbers, we remain like a politician caught in a lie, utterly unable to explain why it happened.

Finally, the FTSE appears to have regained the Brexit uptrend and, what's more, is respecting it - as shown on the closing price chart insert. If the market were a share, we'd be pushing open "the door marked summer"!

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

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